Sangam: A Confluence of Knowledge Streams

Infrastructure and Public Utilities Privatization in Developing Countries

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dc.creator Auriol, Emmanuelle
dc.creator Picard, Pierre M.
dc.date 2012-03-30T07:12:37Z
dc.date 2012-03-30T07:12:37Z
dc.date 2009-02-28
dc.date.accessioned 2023-02-18T19:41:25Z
dc.date.available 2023-02-18T19:41:25Z
dc.identifier World Bank Economic Review
dc.identifier 1564-698X
dc.identifier http://hdl.handle.net/10986/4495
dc.identifier.uri http://localhost:8080/xmlui/handle/CUHPOERS/249980
dc.description Should governments in developing countries promote private ownership and deregulated prices in noncompetitive sectors? Or should they run publicly owned firms and regulate prices at the expense of rents to insiders? A theoretical model is used to answer these normative questions. The analysis focuses on the tradeoff between fiscal benefits and consumer surplus during privatization of noncompetitive sectors. Privatization transfers control rights to private interests and eliminates public subsidies, yielding benefits to taxpayers at the cost of increased prices for consumers. In developing countries, where budget constraints are tight, privatization and price liberalization may be optimal for low profitability industries but suboptimal for more profitable industries. And once a market has room for more than one firm, governments may prefer to regulate the industry. Without a credible regulatory agency, regulation is achieved through public ownership.
dc.publisher World Bank
dc.rights CC BY-NC-ND 3.0 IGO
dc.rights http://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.rights World Bank
dc.subject asymmetric information
dc.subject budget constraints
dc.subject consumer surplus
dc.subject consumers
dc.subject debt
dc.subject development economics
dc.subject duopoly
dc.subject econometrics
dc.subject economies of scale
dc.subject gdp
dc.subject industrial economics
dc.subject marginal costs
dc.subject monopolies
dc.subject monopoly
dc.subject natural monopolies
dc.subject opportunity cost
dc.subject opportunity costs
dc.subject perfect information
dc.subject price increases
dc.subject profitability
dc.title Infrastructure and Public Utilities Privatization in Developing Countries
dc.type Journal Article
dc.type Journal Article
dc.coverage Latin America
dc.coverage Peru
dc.coverage Honduras
dc.coverage Puerto Rico
dc.coverage Burkina Faso
dc.coverage Argentina


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